Test: Top 25 Supply Chains of 2016
For the 12th year in a row, analyst firm Gartner has unveiled its rankings of the Top 25 Supply Chains in the world, and for the 12th consecutive year, we offer our own take on the rankings. (Full disclosure: I have been one of the “peer opinion” voters for quite a few years now, so I’m analyzing a process that I also participate in.)
As we’ve noted in the past, the notion that these 25 companies (actually, 27, as you’ll discover) have the very best supply chains in the world is a flawed concept from the very get-go since there are so many exceptions to the rankings. For instance, only large, multi-national, public companies are part of the Top 25. Also, many of the companies you would immediately think of as being supply chain experts (UPS, FedEx, IBM, Disney, Google, et.al.) are omitted from consideration for one reason or another (but none of those reasons have ever struck me as being very compelling).
And there’s also the unmistakable reality that these rankings, when you get right down to it, are mostly popularity contests. Yes, there are metrics involved, such as inventory turns and return on assets, but the opinions of the peer voters and Gartner’s analysts account for 50% of the rankings.
There’s also a new category for corporate social responsibility (CSR), which appears to be based as much on third-party input as it does on any measurable performance metrics. (The CSR scores immediately raise a flag when you discover that Amazon’s score is 0.00, which probably cost the online retailer a chance to repeat as #1 this year, mostly because Amazon doesn’t issue a CSR report as many other public companies do.)
As occurred last year, Gartner has also lifted Apple and Procter & Gamble out of the Top 25 rankings entirely, placing them in a Supply Chain Masters category. Thanks to that move, and Amazon’s CSR score being so poor, we have a new # 1 on this year’s list, which you’ll discover at the very end of the rankings as we count them down from 25 to 1, just like Casey Kasem used to do. Also, we should note that, with several companies joining the rankings this year, that means a couple companies slipped out of the Top 25 in 2016. Those companies are Seagate Technology, Qualcomm, Cummins, Toyota and Home Depot.
The following gallery offers capsule descriptions of what makes each of the Top 25 (plus Apple and P&G) so good at supply chain management, and where appropriate we've included observations from Gartner’s analysts—Stan Aronow, Michael Burkett, Kimberly Nilles and Jim Romona—as to how and why each company finished where it did on the list.